Ethereum Just Reversed and $240 Is Imminent, Here's Why

Ethereum failed again to surpass the $288 resistance area against the US Dollar. As a result, ETH price declined sharply below $270 and it might soon revisit the $240 support.

Ethereum failed on a couple of occasions to surpass $286 and $288 against the US Dollar.

The price is down more than 5% and it broke the key $270 support level.

There was a break below a key bullish trend line with support near $280 on the hourly chart of ETH/USD (data feed via Kraken).

Bitcoin price is also down 5% and it tumbled below the $9,800 support area.

Ethereum Price Could Revisit $240

Recently, we saw a decent upward move in Ethereum above the $270 and $275 levels against the US Dollar. However, ETH price failed to on a couple of occasions to surpass $286 and $288.

As a result, there was a sharp decline below the $280 support level and the 100 hourly simple moving average. It seems like there was a harsh rejection near $286 and the price formed a short term double top pattern.

There was a clear break below the 50% Fib retracement level of the upward move from the $243 low to $286 high. Moreover, there was a break below a key bullish trend line with support near $280 on the hourly chart of ETH/USD.

Ethereum Price

It opened the doors for more losses in Ethereum below the $270 support area. The price even spiked below the 61.8% Fib retracement level of the upward move from the $243 low to $286 high.

Therefore, there are chances of more losses in the near term below $255 and $250. The next main support for the bulls is near the $240 area. Any further losses may perhaps accelerate the decline towards the $230 support area in the near term.

Upsides Capped

If Ethereum price starts a fresh increase above the $265 resistance, it could recover towards $270. Though, there is a major resistance forming near the $270 area and the 100 hourly simple moving average.

A successful close above the $270 resistance and the 100 hourly simple moving average is needed for a fresh rally. The main hurdle for the bulls is still near the $286 and $288 levels, above which the next aim could be $300.

Technical Indicators

Hourly MACD – The MACD for ETH/USD is currently gaining strength in the bearish zone.

Hourly RSI – The RSI for ETH/USD is now well below the 50 level, with a bearish angle.

Major Support Level – $250

Major Resistance Level – $270

Aayush is a Senior Forex, Cryptocurrencies and Financial Market Strategist with a background in IT and financial markets. He specialises in market strategies and technical analysis, and has spent over a DECADE as a financial…